Limited Liability Company Lugzor and Others v. Russian Federation
PCA · Investment (ICSID and treaty) · Russian Federation · 30 Mar 2023
Why it matters
This case is one of many investor-state arbitrations arising from Russia's annexation of Crimea. It addresses the application of the Ukraine-Russia BIT to investments in Crimea and the procedural issues of jurisdiction and admissibility in the context of a non-participating respondent that later joined the proceedings.
Summary
The arbitration was initiated by five Ukrainian companies (Lugzor, Libset, Ukrinterinvest, DniproAzot, and Aberon Ltd) against the Russian Federation under the Ukraine-Russia Bilateral Investment Treaty (BIT) and the UNCITRAL Arbitration Rules 1976. The claimants alleged that Russia breached Articles 2, 3, and 5 of the BIT by interfering with and expropriating their investments in real estate located in Crimea. Russia initially did not participate but later joined, challenging jurisdiction and the merits. The Tribunal, composed of Professor Donald M. McRae (Presiding), Judge Bruno Simma (claimants' appointee), and Dr. Eduardo Zuleta Jaramillo (respondent's appointee), held a hearing in May 2021. After Russia's counsel withdrew in 2022, Russia unsuccessfully sought to change the place of arbitration. On 4 October 2022, the Tribunal issued its Award on all issues, later corrected for clerical errors on 2 December 2022. The press release does not disclose the outcome or quantum.
The detail
Parties: Limited Liability Company Lugzor and Others v. Russian Federation
Case number: PCA Case No. 2015-29
Outcome: The Tribunal issued an Award on all issues of admissibility, jurisdiction, responsibility and damages. The press release does not state which party prevailed or the quantum awarded.
Applicable law: Ukraine-Russia BIT; UNCITRAL Arbitration Rules 1976
Issues in play: The dispute involved the Ukraine-Russia BIT and whether the Tribunal had jurisdiction over claims arising from Russia's interference with investments in Crimea after the annexation.
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Locus Standi links to the source decision and publishes its own plain-language summary. It does not reproduce the text of the award.